the establishment survey for September indicated payroll employment increased by a seasonally adjusted 148,000 to 136,290,000, while the change in payroll employment for August was revised from a net gain of 169,000 jobs to an increase of 193,000 and July's job creation was revised downward from a gain of 104,000 jobs to just 89,000...the unadjusted data for September showed an increase of 612,000 jobs, which was due in part to the 882,600 seasonal increase in employment at local school districts, which was adjusted down to a net payroll jobs gain of just 9,500, and the 468,000 seasonal decrease in jobs in leisure and hospitality, as most temporary summer jobs wound down...our adjacent FRED bar graph shows the seasonally adjusted change in payroll jobs monthly since the beginning of 2008; you might note that payroll jobs gains over the 3rd quarter of this year are the weakest since the 2nd quarter of 2012..

although 148,000 additional jobs was weak compared to most months of the recovery, at least for once they weren't mostly just retail and fast food jobs; the professional and business services category saw an increase of 32,000 payroll jobs, of which 20,200 were in temporary help services; a net of 23,400 jobs were added in the transportation and warehousing sector, with 17,900 of those working in ground passenger transportation services, such as bus drivers; and state governments added a seasonally adjusted 22,000 jobs, 19,800 of which were in state level education; another 20,800 net jobs were added in retail trade, with food and beverage stores adding 7,700 and clothing stores shedding 7,200 employees, while wholesale trade added 16,100 jobs, with 8,700 of those involved in wholesale non-durable goods...in addition, 20,000 jobs were added in construction, of which 10,900 were created by specialty trade contractors, with 6,800 of those non-residential...the only significant seasonally adjusted job losses were in the leisure and hospitality category, where the net employment loss was 13,000 more than a normal September; 7,100 of those were in food services, reversing the trend we've seen in recent months wherein most of the net job gains were in food service or retail...

our FRED bar graph below shows some of these seasonally adjusted trends over the last 13 months; in each monthly grouping of 8 bars, the monthly change in manufacturing employment for that month is indicated in blue, the change in monthly construction employment is in red, the change in retail employment is in dark green, the monthly change in government jobs is in yellow, and the change in employment in professional and business services, which includes everything from accounting services to garbage collection, is in grey; also included are the BLS employment subcategories of jobs in bars and restaurants, the major component of the leisure and hospitality category, in light green, and the two major subcategories of the education and health services category, health care jobs in orange, and jobs in education shown in violet...it's clear from this that a significant portion of the jobs created over the past year are in the two categories shaded green, retail sales and food services, and one other area of major jobs creation - professional and business services in grey - is indicative of mostly clerical and temporary help, while creation of higher paying jobs in manufacturing - blue - and education - violet - have lagged...(a net of just 100 new education jobs were created in September, hence the violet bar is invisible in the last group below)

one additional graphic we’ll add here to put it all in perspective comes from Robert Oak of the Economic Populist; the pie graph below shows the percentage of payroll jobs by industry as of September, making it clear where the largest proportion of jobs in our current economy are at...in his graphic coverage of this report, Robert pairs this graph with a similar pie graph from 2008, in an effort to show that the wedges for the decent paying jobs in manufacturing and construction have both shrunk by 1.1% of the total each since the recession started...our purpose here is just to show the percentages of each by way of general overview... a clarifying footnote we should add is that the large green government wedge - 17% of all payroll jobs - includes jobs in education at the state and local levels, while the CES category of education and health services is mostly jobs in health care; just one-sixth of that are those in educational services, which includes jobs at private colleges, occupational training services and the like, while nearly half of the government jobs are in education at the state and local levels..

the number of us employed part time "for economic reasons" in September rose by 15,000 to 7,926,000; these are those who reported that either their workplace cut their hours or they could only find part time work; nonetheless, U-6, the broadest measure of labor underutilization, still fell from 13.7% in August to 13.6% in September...those who were working part time who didn't indicate that they wanted full time work fell by a seasonally adjusted 372,000 to 18,967,000; oddly, the unadjusted data shows the opposite; that those who are working part time voluntarily rose by 1,472,000 to 18,848,000...of course, some of those part time workers may be holding two jobs; the number of multiple jobholders was up by 56,000 in September to 3,393,000; note that the establishment survey does not distinguish between full and part time jobs and includes no data on the individuals holding the reported payroll jobs...

the number of us officially unemployed more than 27 weeks fell by 144,000 in September to 4,146,000; this doesn't necessarily mean those who are no longer in this metric found work; they may have simply not looked for work during the reference period and hence weren't counted...those of us unemployed 5 weeks or less, ie, the newly unemployed, rose by 33,000 from August's level to 2,596,000...among those of us not officially in the labor force and hence not counted in any of these metrics, an additional 5,775,000 reported that they still want a job; of those, 2,302,000 are categorized as "marginally attached to the labor force" because they've looked for work sometime during the last year, but not during the 30 day period covered by the September household survey...852,000 of those are further characterized as "discouraged workers, because they say that they havent looked for work because they believe there are no jobs available to them...the number of "discouraged workers" has increased by 50,000 from September a year ago...

Inconsistent Adjustments and Reports

lastly, we have to again point out that there still is a major incongruity in the seasonal adjustments between the two surveys; you may recall that last month we noted that the seasonal adjustments subtracted more than 200,000 jobs from the August establishment survey but added nearly 500,000 to the August household survey; although that was disturbing, we were advised that it would likely be at least partially reversed with this release; that didn't happen; instead, the seasonal adjustment continued to subtract hundreds from the the number of payroll jobs reported, while it only subtracted a trivial 9,000 jobs from the household survey count of those employed; to recap, taking the latest revisions into account: last month the unadjusted payroll data showed a gain of 411,000 jobs in August; the seasonal adjustment lowered that to 193,000 jobs gained, while this month's unadjusted establishment survey data showed an increase of 612,000 jobs, which was lowered by the seasonal adjustment to the headline 148,000 job gain...conversely, the household survey showed a 604,000 drop in the count of the employed in August, which was raised to a loss of just 115,000 in the employed, while in this September household survey we've just looked at, unadjusted employment rose 142,000 to 144,651,000, and the seasonally adjustment lowered that to an increase of 133,000 employed...so, over the course of the past two months, the seasonal adjustment subtracted 682,000 from the payroll jobs recorded by the establishment survey, while the adjustment on the household survey added 480,000 to the count of those employed...while we wouldn't expect the seasonal adjustments in the two surveys to move in lockstep, this much of a divergence just doesn't make sense...

August Trade Deficit Virtually Unchanged from July at Levels Above 2nd Quarter

in addition to the jobs reports, the August report on our International Trade in Goods and Services (pdf), originally scheduled for release on October 8th, was released by the Commerce Dept on Thursday morning...it showed a slight widening of our trade deficit, as our exports fell a bit and our imports were virtually unchanged; total August exports of $189.2 billion, up from $189.1 billion in July and imports of $228.0 billion, essentially the same as July's number, resulted in a goods and services deficit of $38.8 billion, up from the revised trade deficit of $38.6 billion recorded in July...exports of goods fell $0.3 billion to $132.4 billion, while exports of services increased $0.1 billion to $56.8 billion; and imports of goods decreased $0.1 billion to $190.7 billion, while imports of services increased $0.2 billion over July to $37.4 billion....since the trade deficit in July represented a 13.3% increase over June's figures, that August was unchanged from that means we're now two thirds of the way to seeing a significant hit from net trade when 3rd quarter GDP figures are released...our FRED bar graph below shows the monthly change in exports in blue, imports in red, and the balance of trade in brown over the past two years…although our net trade is always a deficit, it is the change over the quarter shown in brown that influences the GDP calculation…in the 2nd quarter of this year, the increase in exports matched the increase in imports, resulting in no change to GDP from our international trade.. major changes in our August goods exports from July's include a $1.3 billion decrease in our exports of industrial supplies and materials, headed up by a $880 million decrease in exports of non-monetary gold down to $2.47 billion, a $527 million decrease in exports of "other" petroleum products, to $4.85 billion, and a $410 million decrease in exports of organic chemicals to $2.83 billion, which was slightly offset by a $283 million increase in exports of fuel oil...August also saw a $0.4 billion decrease in exports of foods, feeds, and beverages; a $187 million decrease in wheat exports and a $147 million decrease in soybean exports accounted for the lions share of that....on the other side of the export ledger, August saw a $0.7 billion increase in exports of automotive vehicles, parts, and engines, a $0.3 billion increase in exports of consumer goods, topped by a $424 million increase in exports of gem diamonds diminished by a $147 million decrease in exports of pharmaceuticals, a $0.2 billion increase in exports of capital goods, topped by a $418 million increase in exports of civilian aircraft, which counted as $5.26 billion of our August exports, and which were offset by decreases of $232 million in telecommunications equipment and $222 million of computer accessories...

the major month over month changes in our imports of goods included a $1.0 billion increase in imports of capital goods, which included a $642 million increase in imports of computers to $5.56 billion, and a $251 million increase in imports of 'other" industrial machines, which was offset in part by a $168 million decrease in imports of semiconductors and a $167 million decrease in imports of engines for civilian aircraft...August also saw an $0.8 billion decrease in imports of consumer goods, which included $667 less pharmaceuticals, $297 million less artwork and collectibles, and $169 million more cotton apparel imports, and a $0.2 billion decrease in industrial supplies and materials, which notably included $594 million less imports of crude oil, and a $233 million increase in imports of automotive vehicles, parts, and engines...and although the major import category of foods, feeds and beverages was virtually unchanged in August, we did see a $159 million increase in imports of fish and shellfish, offset by a $138 million decrease in imports of edible oils and oilseeds...in a special category tracked separately without seasonal adjustment, our advanced technology products exports were $26.7 billion in August while imports were $32.6 billion, resulting in a high-tech goods deficit of $5.9 billion…

our bilateral deficits in August goods trade, which are also not seasonally adjusted, generally showed modest improvement; our goods deficit with China fell to $29.9 billion, from $30.1 billion in July; our goods trade with the EU shrunk to $9.8 billion, from $13.9 billion, and our goods deficit with OPEC fell slightly from $7.4 billion to $7.3 billion....other larger bilateral goods deficits in August were with Japan at $6.4 billion, Germany at $5.4 billion, Mexico at $4.9 billion, Saudi Arabia at $3.6 billion, Canada at $2.3 billion, Ireland at $1.9 billion, Korea at $1.7 billion, India at $1.6 billion, and Venezuela at $1.5 billion; meanwhile, we ran small surpluses in August goods trade with Hong Kong at $3.7 billion, Brazil at $1.7 billion, Australia at $1.4 billion, and Singapore at $1.1 billion...the graph below from Bill McBride tracks our total trade deficit in blue for each month since January 1998, and then breaks that into an oil component in black and an “everything else” component in red…note the graphs are shown as a negative amount from the top "$0” bar, ie, the further down, the worse it is…clearly, roughly half our trade deficit has been in oil since the onset of the recession (the pale blue vertical bar); the price of crude averaged $100.26 a barrel in August, up from $97.07 in July, and up from $94.48 a year ago…

(the above is my weekly commentary that accompanied my sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in getting my weekly emailing of selected links that accompanies these commentaries, most coming from the aforementioned GGO posts, contact me…)

even though the shutdown began on Oct 1st and was over on the 17th, we've essentially missed three weeks of economic data, since no major reports were released this week nor in the week beginning Sept 30th...last week we mentioned a number of economics reports that had gone by the boards in the first two weeks of the shutdown, including September's jobs report and retail sales and August trade data; this week we've also missed September's reports on industrial production and capacity utilization, consumer prices, and new housing starts...the BLS has published a revised schedule of when delayed reports will be released; notably, the September jobs report will be released this coming Tuesday, the job openings & labor turnover report will be released Thursday, and the consumer price index will be released on Wednesday, October 30....the delay of the CPI data has also delayed computation of cost of living adjustments for Social Security and other pensions that use the same COLA, as the annual increase is based on the average of CPI-W over the months of July, August and September compared to the CPI-W for the same months from last year; in addition, a note from the Cleveland Fed, which uses the BLS CPI data to compute a median and trimmed median price index, reports that the furlough of BLS employees involving in collecting the prices used in computing the CPI has the potential to induce errors in the CPI for as long as seven months, and hence in other programs and data its input is used to adjust, such as Treasury inflation protected securities and the PCE deflator...to compute the CPI for any given month, BLS field reps normally spend the entire month visiting stores, car dealers, doctors’ offices and other outlets to collect the 83,000 prices which are used as a basis for that month's report, normally reported in the middle of the next month...so while that means the crucial September CPI will be OK, computation of the October CPI will be missing more than a half month's worth of data...moreover, while food prices are collected daily, some price points are only checked every other month and batches of home and apartments rents are only collected every six months...so for some of those prices that were missed during the October furlough of CPI data collectors, the reports will not reflect their inclusion until May...

other data will be skewed as well; the furlough of employees from the bureau of labor statistics not only delayed the employment summary and JOLTS but has also postponed the full week of data collection that should have been undertaken for the October household and establishment surveys, which means that October's job data will not be easily comparable with September's or November's on a month to month basis; that's because the labor department conducted the surveys for September during the week of September 9th, and they'll conduct those surveys for November during the week of November 11th, while the employment data collection for October wont begin until Monday, the week of October 21st; as a result, the September report, when released will report on changes over the 28 days between that survey and August's, the October report will include employment changes over the 42 days between the September surveys and the delayed October surveys, and the November jobs report, which will again be on schedule, will only reflect employment changes over 21 days...we would not be surprised to see similar problems such as this, or as we've seen with the CPI, in other data...for instance, the data on housing starts, as unreliable as they are already, are also collected by census field reps, who visit housing permit offices and conduct road canvasses to gather the small sample of housing activity used in that report, which will now be half the size it normally is in October...

(the above is my weekly commentary that accompanied my sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in getting my weekly emailing of selected links that accompanies these commentaries, most coming from the aforementioned GGO posts, contact me…)

of course, with the agencies that produce the monthly economic reports we usually cover in this space shut down or operating with bare bones staffing, those reports are not being issued; you all know we missed the September unemployment report and Factory Orders for August last week, but the shutdown will also delay the data gathering for the October unemployment report; as both the establishment survey and the household survey for October should take place this week; since the 12th of the month, the target date for those surveys, occurred late in the week, it probably wont skew the data that much if there's a quick resolution and the surveys can be conducted this week; but they're delayed any longer, the typical month over month comparisons we and others typically look at in these reports will be meaningless ...similar caveats may also have to be applied to the other reports that have been missed; construction spending for August, the trade balance for August, the Job Openings and Labor Turnover Survey (JOLTS) for August, wholesale trade, sales and inventories for August, business inventories for August and retail sales for September...in addition, the producer price index was to have been issued Friday and the consumer prices index is due this coming Wednesday, and the data collection for those may have gone by the boards as well...and despite the fact that the Fed is opening and functioning, their G-17, the report on industrial production and capacity utilization, will not be released on schedule this coming week because they rely on data collected by other government agencies…

this release includes a major backward revision extending back to January 2006 that boosted estimates of non-revolving credit from that time forward by adding several items to better reflect outstanding student loan debt; first, Perkins loans, which are low interest rate loans to impoverished students from the Dept of Education, were added to the Federal Government credit sector, as were loans purchased under the Ensuring Continued Access to Student Loans Act of 2008 from nonprofit and educational institutions, all defaulted loans held by the federal government, and accrued interest on all federal student loan balances; this boosted the totals in that credit sector, which we'll look at later, by roughly $110 billion; in addition, they've added a new credit sector to this report under the heading "Nonprofit and Educational Institutions" which encompasses loans directly from those institutions not previously included in this report; as of August, this new non-revolving credit showed $62.9 billion in loans outstanding....our adjacent ALFRED graph shows the cumulative effect of these revisions; in blue, we have the total non-revolving credit outstanding back to 2006 as had been indicated by this G19 report as released on the 9th of September; while the red line shows what this report now shows as non-revolving credit over the same history as it's been revised..

now, the reason we've been following this report for the past few years was to keep an eye on the expansion of the student debt bubble, and although the increases in student loans outstanding over the past two months have been modest compared to most months during the recession, the double digit increases we've seen earlier reasserted themselves in August...below we have a screenshot of a portion of the second table in the Fed G-19 release from which we've eliminated the revolving credit details to focus on the non revolving credit, and more specifically student loans held by the federal government...with the simplified table below, you can see all contributions to non revolving credit from each credit sector for every year from 2008 to 2012, and then also the contributions to non revolving credit from those sectors for the first quarter (Q1) the 2nd quarter (Q2), and the monthly aggregates for June, July and August; note also that these totals are not seasonally adjusted....the line labeled "non profit and educational institutions", representing student loans from those institutions, is new with this report as per the revision we discussed earlier, as are the annual and current totals for consumer credit held by the Federal government...(compare the table below to last month’s)...in July, that total was $679.4 billion; by August it had grown to $701.3 billion, a $21.9 billion increase, or at an annual rate of 46.3%; meanwhile the change in total non-revolving credit from July to August ($2,164.6 billion to $ 2,196.3 billion) was $31.7 billion, so the lion's share, or 69% of the August increase in non-revolving credit, was new student debt, not car loans as bloomberg would have you believe...from August a year ago, student debt owned by the federal government has increased from $582.4 billion, a 20.4% increase…

August LPS Mortgage Monitor: Average Days to Foreclose at 895 as National Pipeline Ratios Remain Over 3 Years

next we'll include this month's table showing the percentages of non-current (NC) mortgages for each state (from page 20 of the pdf); shown for each state are the percentage of home loans that are delinquent (Del%), the percentage of mortgages that are in foreclosure (FC%), the total mortgages that aren't current with their payments (NonCurr%) and the year over year change in the number of non-current mortgages; also note that states that have a judicial foreclosure process, where the bank must prove their right to foreclose on a homeowner in court, are marked by a red asterisk ...although the percentage of non-current mortgages in Florida is down 27.2% from last year's 20.7% level, they still lead the nation in the percentage of non-current mortgages at 15.1% and percentage of mortgages in foreclosure at 8.5%, while all the states that still have more than 4% of their mortgaged homes in foreclosure are also all judicial states; New Jersey with 7.2%, New York with 5.6%, Hawaii with 5.3%, Maine with 5.1%, Connecticut with 4.4%, and Illinois with 4.1%...also note that the non-judicial state of Mississippi, the state with the 2nd most non-current mortgage, is something of an outlier here, as they've has a chronic delinquency problem, with 12.6% of homeowners late on their housepayments, while they're still below the national average of homes in foreclose at 2.2%...

the next graph that we'll look at from the mortgage monitor (page 15) shows the historical tracks of monthly foreclosure starts in blue and foreclosure sales in red since the beginning of 2005; foreclosure starts are those mortgages that had the first foreclosure action taken against them in that month, while foreclosure sales are those mortgages that have proceeded through the last legal step in that month, which is typically an auction that transfers the home into the bank REO (real estate owned) portfolio....we can see foreclosure starts in blue beginning to rise from just over 50,000 a month in 2005 to 135,000 in September 2007 to where it peaks at 316,000 foreclosure starts in March of 2009, after which the number of foreclosure starts tended to stay well over 175,000 a month until early this year, falling to a post housing bust low of 108,000 in August, down 4.7% from July's 112,850...completed foreclosures in red, however, have trended much lower throughout the recession; they rose from a pre-crisis 25,000 a month to an average of near 100,000 a month throughout 2009 to peak at 124,000 in September of 2010, then fell back to below well below 100,000 a month after the robosigning foreclosure fraud scandal hit....and although the foreclosure sales line has been trending down, averaging 61,000 a month in 2013 compared to 73,000 a month in 2012, they have remained above 50,000 a month until August, when completed foreclosures jumped 23.7% over July's level to 70,000....

now what you should also notice from this graph is that foreclosure starts have been running well ahead of foreclosure completions, by as much as 200,000 a month from 2009 through 2011, and more than normal (defined by the gap of less than 50,000 a month in 2005) throughout the crisis....so what happened to all those homeowners who had foreclosure actions taken against them early in the crisis? while some who had foreclosures started against them may have cured their mortgage by making the missing payments, negotiated a short sale or otherwise worked out a mortgage modification, the lions share of them appear to still be in foreclosure limbo...in the table below (from page 20) we have the total loan counts of delinquent mortgages by days delinquent, the number in foreclosure (FC) and the foreclosure starts for each January since 2008 and each month since 01/2012...but what we want to look at it is the last column, which lists the "average days delinquent for foreclosure" for each month listed; you can see that by the beginning of 2012 those in foreclosure had been delinquent for an average of 668 days, and some obviously much longer, since a number of those in foreclosure probably first has theirs initiated in 2011...by June of last year, those in foreclosure had been delinquent on their mortgages for over 2 years, and that duration continued to lengthen to 876 days by July of this year and increase by another 19 days with this August report...when an average length in foreclosure jumps as much as 19 days over a month even as new foreclosures are started, it's obvious that most of those who've been in foreclosure for years aren't going anywhere...

we would also note on the above table the second column from the right, which similarly shows the average of how may days those who've been delinquent for more than 90 days have remained in their homes without being foreclosed on...in a reversal of the trend, the average length of time that those seriously delinquent have remained in their homes without being foreclosed on has fallen to 505 days, down from 517 days in July and at a 4 month low...since foreclosure starts are at a new crisis low, we'd have to guess many of those who left that long term delinquency status in August either exited via a short sale or a mortgage modification of some kind; nonetheless, of the 1,347,000 plus homeowners who were seriously delinquent in July, a significant portion of them likely lived in their homes without making payments for 2 years or more before making that exit...

returning to the predicament where we see that the average homeowner who is in the foreclosure process has been in that situation for nearly 900 days, we'll now look at a bar graph below (from page 17) that shows the pipeline ratios for 10 select judicial states in red and 10 non-judicial states in blue...the foreclosure "pipeline' is the duration that a mortgage spends in the foreclosure process between the foreclosure start and the foreclosure sale, which completes the process; in computing the pipeline ratio, the industry takes the sum of all those mortgages that are seriously delinquent or in foreclosure in a given state and divides it by the average number of completed foreclosures per month over the last 6 months....what this number gives us is the number of months it would take for all those in the foreclosure inventory and the pre-foreclosure inventory to clear at the current rate foreclosures are being completed in that state…thus, for the judicial states, where a foreclosure must go through the courts, at the rate at which foreclosures are being processed nationally, it would take more than 4 years - 49 months to be exact, for all those seriously delinquent and in foreclosure homes to be adjudicated...but as you see by the red bars; the pipeline ratio in some states is much longer; in New York at the rate foreclosures are being processed, it would take 323 months, yes, nearly 27 years to clear the backlog; New Jersey at 211 months, or 17 and a half years, and Hawaii, at 201 months, aren't much faster...but overall the foreclosure pipeline in these judicial states has been dropping, from an average of 118 months in early 2011 too the current 49 months now...however, the non-judicial states, where foreclosures have always been faster, have not seen much change, because several of them have passed laws protecting homeowners and levying fines for foreclosure fraud...so we now see a nonjudicial state such as Massachusetts with a pipeline ratio of 168 months, up 136% from the second quarter a year ago, meaning it would now take 14 years to clear that state's foreclosure backlog; the ostensible reason? last year Massachusetts passed a law giving judges the power to decide whether a bank can foreclose or must modify the mortgage; similarly, California, a non judicial atate where foreclosures had been executed rapidly, has now seen a 68% increase in the foreclosure pipeline with the passage of a homeowners Bill of Rights, written to curtail lender abuses; likewise, Nevada passed a law in 2011 making it a felony if a mortgage servicer made fraudulent representations concerning a title, and imposed fines up to $5,000 for falsifying documents, which temporarily brought foreclosures in that state to a standstill... although foreclosure proceedings in Nevada have since resumed, they're at a slower pace, and hence the foreclosure pipeline for that state at 42 months is still 56% higher than it was before the law was passed...

(the above is my weekly commentary that accompanied my sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in getting my weekly emailing of selected links that accompanies these commentaries, most coming from the aforementioned GGO posts, contact me…)

the ADP report also includes the number of jobs added in 5 select industries; construction, manufacturing, trade, transportation & utilities, professional & business services, and financial services; thus they omit job numbers in BLS categories for mining & logging, information tech, health care & education, and leisure and hospitality, likely because their employer base doesn't have a large enough sample in those areas to generate an accurate estimate...in September, ADP showed 16,000 jobs were added in construction, 1,000 jobs added in manufacturing, 54,000 new jobs in trade, transportation & utilities (many of which are probably retail sales), 27,000 additional jobs in professional & business services, and a loss of 4,000 jobs in financial services...the bar graph below from ADP shows a representation of those new September jobs in each of those areas in the far right bar, and jobs added in each of the previous 12 monthly bars before that, where red represents jobs added in professional & business services, dark grey are jobs added in trade, transportation & utilities, light green are jobs added in construction, orange is net job creation in manufacturing, and blue represents jobs added in financial services, where any color appearing below the “0” line meaning jobs in that category were lost that month..

to compare that ADP graph above to BLS data over the same time period for the same job categories, we have created the FRED bar graph below which includes jobs added or lost according to the establishment survey in each of those ADP selected industries, maintaining the color scheme from ADP with roughly the same colors from the FRED palate; again, each cluster of five bars below represents jobs added or subtracted in each month between September of last year and August this year (but not the missing current report), with red representing jobs added in professional & business services, grey representing jobs added in trade, transportation & utilities, light green representing jobs added in construction, orange representing jobs added in manufacturing, and blue representing jobs added in financial services…from here it looks like ADP jobs data above and BLS jobs data below are fairly close for trade, transportation & utilities in grey, construction in orange, and financial services in blue…but ADP doesn't match where BLS show weak manufacturing job creation (green) in recent months, and both show some inconsistent swings in jobs added in professional & business services, shown in red on both graphs…

Gallup Polling Finds No Growth in Percentage Employed Full Time Since 2010

in computing an unemployment rate, Gallup figures the percentage of the workforce that are unemployed over a given month, with the "workforce" definition similar to the BLS's "labor force", ie, those adults who are working or actively looking for work and available for employment at the time they're surveyed...as collected and originally reported, Gallup's unemployment rate is not seasonally adjusted; thus their unemployment metric shows quite a bit volatility due to seasonal factors; Gallup's unadjusted unemployment rate fell to 7.7% in September, after a 18 month high at 8.7% in August, so it's now back near the same levels of June and July and the lowest it's been since April...they also generate a seasonally adjusted unemployment rate using a rather unsophisticated method; they apply the percentage of seasonal adjustment as computed in the previous year's BLS adjustment for that month to this year's data; so, since last year's BLS report adjusted September's unemployment rate upward by 0.2%, they applied that change to this years data to generate a seasonally adjusted unemployment rate for September of 7.9%, down from the 8.6% rate in August, adjusted by the same method...the graph below from Gallup shows their unadjusted monthly unemployment rate from the beginning of 2011 in dark green, with an overlay of their seasonally adjusted unemployment rate computed by that method in light green; it's obvious that both are fairly volatile, some of which might be due to the small sampling...but it does look like the unemployment rate in both metrics has been stuck in the same range over the past year and a half...

although this report includes input from purchasing managers in 18 manufacturing industries, the ISM does not break out the PMIs for specific industries; rather, they just list them in an order from fastest growing to slowest growing and a similar order for those in contraction...those industries that saw the greatest growth in new orders in September were textiles; plastic & rubber products; oil & coal products; fabricated metals; and printing & related activities, in that order; the three industries that saw new orders contraction in September were nonmetallic mineral products; primary metals; and machinery...meanwhile, those that saw the most expansion in production in September were food, beverage & tobacco products; electrical equipment, appliances & components; furniture and paper products, in that order, while 5 industries saw a slowdown in production: textiles; apparel and related products; primary metals; plastic & rubber products; and nonmetallic mineral products...eight industries reported more hiring in September, led by electrical equipment, appliances & components; wood products; printing & related activities, and furniture & related products; meanwhile, 6 industries saw employment contract for the month; apparel and related products; primary metals; nonmetallic mineral products; miscellaneous manufacturing; transportation equipment; and computer & electronic products, in that order...

of the 11 non-manufacturing industries reporting growth in September, those showing the greatest grow were retail trade; management & support of companies; transportation & warehousing; construction; utilities; information; and finance & insurance, in that order; the 4 service industries reporting contraction in September were arts, entertainment & recreation; educational services; health care & social assistance; and mining...our FRED graph above shows the history of the NMI since it's inception in January of 2008 in blue, and the track of the older manufacturing PMI since 2000 in red, with recessions marked by grey vertical bars; we’ve also included in light grey the track of the older ISM non-manufacturing Business Activity Index, which is now incorporated into the NMI, as a indicator of the historical track of the service industries before the creation of the composite NMI…it's a very short history, but it appears that the manufacturing index tends to lead the non-manufacturing index changes...

(the above is my weekly commentary that accompanied my sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in getting my weekly emailing of selected links that accompanies these commentaries, most coming from the aforementioned GGO posts, contact me…)

note on the graphs used here

in March a year ago the St Louis Fed, home to the FRED graphs, changed their graphs to an interactive format, which apparently necessitated eliminating some of the incompatible options which we had used in creating our static graphs before then...as a result, many of the FRED graphs we've included on this website previous to that date, all of which were all created and stored at the FRED site and which we'd always hyperlinked back there, were reformatted, which in many cases changed our bar graphs to line graphs, and some cases rendered them unreadable... however, you can still click the text links we've always used in referring to them to view versions of our graphs as interactive graphs on the FRED site, or in the case where an older graph has gone missing, click on the blank space where it had been in order to view it in the new format....